Starting with plan renewals after September 23, 2010, the Affordable Care Act (ACA) requires that employers who provide dependent coverage allow children to stay on their parent’s health insurance plan until age 26.  Various studies have documented a substantial increase in health insurance coverage for targeted young adults as a result of this provision.  This paper examines whether the increased health insurance coverage also increased the demand and utilization of medical care. Specifically, we study the effect of the ACA dependent coverage expansion on demand and use of medical care in emergency, ambulatory and inpatient settings in Florida. Our sample consists of patients aged 16 to 29 who had an emergency, ambulatory/outpatient or inpatient visit in Florida from 2007 to the second quarter of 2012.

We use a difference-in-difference analysis that compares targeted and excluded young adults before and after the implementation of the ACA provision. We classify treated young adults as those aged 19 to 25; and 16 to 19 and 27 to 29 year olds as our control group. Our analysis controls for patient comorbidities and observable characteristics such as race and sex. We investigate the effect of the insurance expansion on the number of young adults who seek medical care, length of stay, total charges, and number of procedures performed.

We find that targeted young adults increased their medical care use in all three settings with the biggest increase in utilization coming from medical care use in the ambulatory/outpatient facilities (8% increase). We find no change in the number of procedures performed and a decrease in total charges of about 2 percent.  This suggests the increase in outpatient care use is not associated with a corresponding increase in overall medical resource use.  Emergency room (ER) use increased by 7 percent as a result of the provision, with male young adults using the ER more than female young adults.  We do not find a significant increase total charges or number of procedures performed in the ER. For inpatient care, we find a 5 percent increase utilization, and a 1.2 percent increase in length of stay with no corresponding change in total charges. Female young adults significantly increased their use of inpatient care in all our measures of utilization and demand.  

Overall, our results indicate that while all young adults benefited from increased access to medical care as a result of the ACA mandate, there are gender differences in the choice of facility for medical care use. we find that women were more likely than men to use inpatient care.